Saudi Arabia revealed plans to extend its voluntary cut of one million barrels per day into September or even more.
“Saudi Arabia will extend the voluntary cut of one million barrels per day, which began to be applied in the current month of July, for another month, to include the month of September, with the possibility of extending or extending and increasing this,” SPA reported, citing an official source in the country’s Ministry of Energy.
The Kingdom’s production in September will be approximately 9 million barrels per day, the report said.
Saudi Arabia strengthens OPEC+ efforts
The voluntary reduction is to reinforce the precautionary efforts made by OPEC+ countries with the aim of supporting the stability and balance of oil markets.
Analysts see Saudi Arabia’s indication on even further deepening of the voluntary production cut is seen as a move flagging the possibility of further market tightening.
Russia will also cut oil exports by 300,000 bpd in September, Deputy Prime Minister Alexander Novak said shortly after the Saudi announcement, Reuters reported.
OPEC+ agreed on a broad deal to limit supply into 2024 at its last policy meeting in June, and Saudi Arabia pledged a voluntary production cut for July that it has since extended to include August.
A panel from OPEC+, which includes members the Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia, is meeting on Friday.
However, the Joint Ministerial Monitoring Committee is unlikely to tweak oil policy at its Friday meet, the Reuters report said, citing unnamed sources.
OPEC+, which pumps around 40 percent of the world’s crude, has been limiting supply since late 2022 to support the market.
Meanwhile, the Saudi announcement made an immediate impact in the market, with oil price rebounding from an earlier decline on Thursday, with Brent crude futures up 42 cents to $83.62 a barrel by 1328 GMT.
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